Republicans want to know the cost of inflation on 2023 Defense budget

The DoD Reporter’s Notebook is a weekly summary of personnel, acquisition, technology and management stories that may have fallen below your radar during the past week, but are nonetheless important. It’s compiled and published each Monday by Federal News Network DoD reporters Jared Serbu and Scott Maucione.

While the Biden administration is asking for $773 billion for 2023, that number may not go as far as hoped.

The Defense Department says it finished up its planning for 2023 before inflation rates rose and before Russia invaded Ukraine causing oil prices to spike.

According to DoD, it assumed a 2.3% inflation rate when the budget was created, however current rates are more than three times that level.

The top Republicans on the House and Senate Armed Services Committees are curious as to what effect the current inflation rate will have on the military’s buying power next year.

“The inflation we are experiencing is effectively a 5% to 8% cut to the department’s buying power, which could amount to between $20 billion to $30 billion in unfunded costs in fiscal year 2022 alone, not to mention lost buying power in fiscal year 2021 and potential lost buying power in fiscal year 2023,” Sen. Jim Inhofe (R-Okla.) and Rep. Mike Rogers (R-Ala.) wrote in a letter to Defense Secretary Lloyd Austin.

Attached to the letter are 23 questions they want answered by April 15.

Those include: Has DoD appointed an official to lead inflation-related effects? Does departmental leadership have a regularized meeting schedule to discuss inflationary effects on departmental budgets? What major defense acquisition programs and middle-tier acquisition programs have seen the most and least inflation in the above time periods, and why do you believe these programs are experiencing these rates? And what changes in behavior is DoD observing from the defense industrial base due primarily to the inflation spike?

DoD officials say they are keeping an eye on inflation.

“We’re seeing inflationary pressure here in 2022,” Deputy Defense Secretary Kathleen Hicks said last week. “We just had the omnibus pass. That omnibus did not yet take account of inflation in 2022. We’ll be working with Congress through the summer on how this year lands and how it affects service members.” — SM

Congress weighs in on basic needs allowance

Congress created a way to monetarily help struggling service members and their families in the latest defense authorization act. Now lawmakers are chiming in on how the Pentagon can best use that authority.

A mixture of legislators from the House Armed Services Committee and the House Agriculture Committee sent three recommendations to Defense Secretary Lloyd Austin, which they think will best serve people in the military.

Perhaps the most powerful of these recommendations is that the Defense Department exclude basic allowance for housing (BAH) from consideration as income for determining if service members need a basic needs allowance.

“We encourage you to utilize this authority to the greatest extent possible and to exempt as much of the BAH as possible for as many service members as possible,” the lawmakers wrote to Austin.

BAH has proven to complicate the ability for service members to get benefits in the past. The government takes BAH into account when deciding if families should receive SNAP benefits, sometimes leaving low-income military families out.

“The Agriculture Department counts this housing allowance toward your income, despite the fact that the IRS does not treat it as income and other federal subsidy programs do not treat it as income,” Abby Leibman, president and CEO of MAZON, told Federal News Network in April. “We see this as a glitch. What it does is misrepresent service members’ income so they cannot qualify for SNAP despite the fact that that money is actually ongoing for housing costs and cannot be spent on food.”

The Agriculture Department ran a study on military food security, marking only the second academic look at military food issues.

“There’s really two key findings that are really important to focus on here. The first is that one in three active duty soldiers in our sample were classified as marginally food insecure,” said Matthew Rabbit, an economist at the USDA Economic Research Service. “The second key finding here is that the mental health of our service members is key to their long term connection to the military and the wellbeing of their families. Given that we find the service members’ mental health is associated with their food insecurity; addressing food insecurity may be one way to improve these outcomes.”

Marginally food insecure encompasses individuals who report any indications of compromised economic access to food among themselves and their families, which are classified as having marginal, low or very low food security according to the Agriculture Department’s food security status classification system.

Congress created the basic needs allowance to ensure service members were able to put food on the table.

Another recommendation by lawmakers include an opt-out option for service members who do not want to receive the funds. Finally, the letter asks DoD to certify eligibility for the allowance annually to reduce administrative burdens. — SM

At least DoD 758 sites chosen for renaming

One year into its work, the committee advising the Defense Department on changing the names of military property honoring Confederate officers has identified 758 different streets, buildings and bases that need to be considered.

The Naming Commission list of properties it will consider between now and October will go through a test to determine: Whether their names commemorate the Confederacy, and if a recommendation is warranted for renaming or removal.

A vast majority of the items are located in the cultural south with only a few exceptions for New York, Japan, Germany, Hawaii, Rhode Island, Washington State and Washington D.C.

Items on the link include Lee Road on Ft. Belvoir, named after Robert E. Lee; Fort Hood, which is named after John Bell Hood, a Confederate general; and Fort Polk, named after Confederate general Leonidas Polk.

The Naming Commission is made up of eight members including former Marine Corps Commandant Robert Neller, former Navy Adm. Michelle Howard and Rep. Austin Scott (R-Ga.).

Its goal is “providing naming, renaming, and removal recommendations to Congress for all Department of Defense items that commemorate the Confederate States of America or any person who served voluntarily with the Confederate States of America,” according to the commission’s website.

The commission has already deliberated of thousands of possible names to replace the current ones. It has narrowed the list down to about 100 names including Dwight Eisenhower, Harriet Tubman, Colin Powell and Felix Conde-Falcón. — SM

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